Military expenditure and the economy of Zimbabwe

Abstract

This study examines the causal relationship between military expenditure and economic growth in Zimbabwe. The causality relationship between government military expenditure and economic growth has so far received attention from many economists, the dominant ones being Wagner (1890) and Keynes (1936). According to literature, there currently exist four perspectives around the causality relationship military expenditure and economic growth. The first perspective by Keynes (1936) suggests that military expenditure spur economic growth whilst the second perspective by Wagner (1890) mentions that economic growth affects military expenditure. The third perspective says both military expenditure and economic growth affects each other whilst the fourth perspective suggests the existence of no causality relationship at all between military expenditure and economic growth. The results of this study proves that military expenditure does not directly influence economic growth whilst economic growth does also not directly influence military expenditure both in the short and long run.